The Centre has put to rest fears of a complete crackdown on cryptocurrency as a special note from the Union Cabinet on the proposed bill specifies regulation and not a complete ban, NDTV reported.
According to NDTV, that has access to the note, cryptocurrency will be described as crypto-asset and will not be recognised as legal currency. These crypto-assets will be regulated by the Securities and Exchange Board of India (SEBI), said the report.
SEBI may also be given the power to impose a fine -- in the range of Rs 5 crore to Rs 20 crore -- on those found violating the exchange provisions. The offenders can also be sent to jail for up to one and a half years, the report mentioned.
Those who hold crypto-assets will be given time to declare the same.
Besides, the proposed digital currency to be issued by the Reserve Bank of India (RBI) will most likely not be a part of the new crypto bill. Nonetheless, the central bank is expected to regulate issues related to cryptocurrency.
Further, to ensure that crypto-assets are not used for terror-related activities, the provisions of the Prevention of Money Laundering Act (PMLA) are also likely to apply with suitable amendments.
The development comes a few days after Union Finance Minister Nirmala Sitharaman said the government has no proposal to recognise Bitcoin as a currency in the country and that the risk of cryptocurrency going in the wrong hands is being monitored.
She added that there is no decision to stop advertisements of digital currencies while highlighting that the government does not collect data on crypto transactions.
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